The leukemogenic retroviruses, HTLV-I and HTLV-II, have been linked to specific lymphoid malignancies in man. Extensive recent studies have focused on the protein product of a new gene, termed the HTLV Chi gene (also referred to as lor, Chi-lor, and tat-I/II) found in both viruses. This gene has been shown to be involved in transcriptional regulation of viral expression, and thus critical for viral replication. More recently, another protein has been shown to be encoded by the Chi gene mRNA. This protein is encoded from an overlapping reading frame for that of the trans- activating protein. The highly basic nature of this new protein and its nuclear localization suggest a role for this protein in regulation of viral gene expression. Preliminary studies indicate that loss of function of this new protein results in a reduction of transcriptional activation of the HTLV Chi gene, even is the trans-activating protein of HTLV-II, p37 Chi II, is unaffected. Based upon these initial studies, we will determine whether the new protein, termed pX-b, is involved in the trans-activating process of HTLV, and whether its acts at a transcriptional or post-transcriptional level. In addition, I will generate complete viral genomes which specifically lack the gene encoding pX-B, and determine the phenotype of the mutant viral genomes with respect to replication and transformation. As yet, the mechanism of transformation by HTLV is unknown. Characterization of the newly identified protein encoded by the Chi gene is critical to understanding how HTLV-I and HTLV-II transform T cells in vitro and cause leukemia in man.